One Lender Or Multiple?
I have a few properties and am hoping to have more in the future. It seems like it would be beneficial for me to have a single lender handle all of my mortgages for bookkeeping purposes. I can see them all on the same website, etc. What are the pros and cons of trying to find such a lender to do this?
Here is my story. I have three mortgages on three properties that I got over the past two years. Initially, they were financed through different banks. They have all since been bought by one bank. It’s nice to have them all held at the same bank, but I would still always shop around.
the lender may limit you eventually....
if you have a problem with one loan, it could affect all the others, right away...
you also limit your options for individual loans. As a Loan Officer, one loan for an investor works better at indymac, another better at provident. A perfect example is LTV. Provident has the best rates by far but get tricky when falling out of normal rates.
Well a lot depends on the individual properties on both sides of this transaction. .. .
But my guess is that the answer is "Yes".
Among other things you will find that the larger number of apartments in one location makes it possible to hire an on-site janitor who does most of the maintenance.
[ Edited by commercialking on Date 01/25/2006 ]
First of all, I dont understand your calculations? If it get $24k in rent and cost is $14.5k per year, how did u get negative cash. Also you included water/sewer etc...so i guess its a utilities paid deal? If the $2000 doesnt include tenant utilities, then you have a great price at $125k...at least here in Louisiana. If you got to pay tenant utilities, well i guess you would need to be stingy on the offer. Also, why did you say comps are 95-100k and the appraisal is $137k? I didnt understand that....good luck
I end up with negative cash flow because of debt coverage. I will have to mortgage 90 percent. I would be paying utilities except electric. The comps I had were around 100 at the most, but the sellers quoted a recent appraisal of 137...you know what a disparity there could be with appraisals.
I think you are calculating probably too conservatively ( which i like ) I would check the validity of my forecast maintenance cost in view of the great condition of the building, also I would check the misc. cost of $1500.00. if you can cut this down your deal might show better. But I think the expenses as % of the gross rent seem pretty high. Secondly I would check the appreciation rate in the area. If you pay 125 vs. comp of 100 you are paying 25% more, how long will it take you to recover it and then make profit ? Are you willing to wait that long to enter profit area ? Good luck.[ Edited by ashwin on Date 12/06/2005 ]
Thanks alot...I am very conservative to ensure that I am walking into a good deal, that is certain...and sometimes I can get a good deal that is actually a great deal because of my calculations vs. real expenses. Thanks again....what do you consider a good relationship between expenses as a % of rent collected???
On this board, from some people I have heard 40% (excluding of course the mortgage)for apartments. But I think that is for more like for complex where the utilities are paid by owners and the place is not in great shape. My experience is that once the property is in good shape excluding PITI, it is more like 10% for self managing property owners.
Number crunching formula:
http://www.thecreativeinvestor.com/commercial/modules.php?name=Articles&file=article&articleid=467
Seems like it is worth a serious look
I agree. Does anyone have experience buying Deed of Trust? Bad paper? success rate? .50 on the dollar or less?
I agree and understand-my first thought was that we would just have to go case by case. I have to assume that she has made some kind of effort to recoup her losses and was unsuccessful. When we meet I will propose what you have outlined, and go from there. Thank you for your advice-totally new territory for us.